Lavelle-Hayden v. Employment Dept.

490 June 22, 2023 No. 310

Argued and submitted April 19, reversed and remanded June 22, 2023

Alison K. LAVELLE-HAYDEN,

Petitioner,

v.

EMPLOYMENT DEPARTMENT

and Legacy Good Samaritan

Hospital and Medical Center,

Respondents.

Employment Appeals Board

2021EAB1066; A177971

533 P3d 75

Claimant seeks judicial review of an order of the Employment Appeals Board

(EAB) upholding employer Legacy Good Samaritan Medical Center’s denial of her

claim for unemployment compensation after EAB determined that claimant was

disqualified from receiving unemployment benefits because she was discharged

from her position as a respiratory therapist for misconduct for having violated

employer’s policy in refusing to receive a COVID-19 vaccination. In claimant’s

four assignments of error, claimant contends that EAB’s order violated claim-

ant’s rights, either under the First Amendment or because claimant’s action

in refusing to be vaccinated was based on a sincerely held religious belief that

employer had an obligation to accommodate under Title VII of the Civil Rights

Act of 1964, 42 USC sections 2000e to 2000e-17. Held: The Court of Appeals

rejected claimant’s contention that EAB’s determination that she was discharged

for misconduct violated Title VII of the Civil Rights Act of 1964. But the court

accepted the Employment Department’s concession that EAB’s order was not sup-

ported by substantial reason, in light of EAB’s failure to make a determination

whether claimant’s misconduct was the result of a sincerely held religious belief,

which would preclude a disqualification from unemployment compensation based

on misconduct. The court remanded the case to EAB for reconsideration.

Reversed and remanded.

Ray D. Hacke argued the cause for petitioner. Also on the

briefs was Pacific Justice Institute.

Michael A. Casper, Assistant Attorney General, argued

the cause for respondent Employment Department. Also on

the brief were Ellen F. Rosenblum, Attorney General, and

Benjamin Gutman, Solicitor General.

Sophie Shaddy-Farnsworth argued the cause for respon-

dent Legacy Good Samaritan Hospital and Medical Center.

Cite as 326 Or App 490 (2023) 491

Also on the brief were Brenda K. Baumgart, Crystal S.

Chase, and Stoel Rives LLP.

Before Tookey, Presiding Judge, and Egan, Judge, and

Kamins, Judge.

TOOKEY, P. J.

Reversed and remanded.

492 Lavelle-Hayden v. Employment Dept.

TOOKEY, P. J.

Claimant seeks judicial review of an order of the

Employment Appeals Board (EAB) upholding employer

Legacy Good Samaritan Medical Center’s denial of her claim

for unemployment compensation after EAB determined that

claimant was disqualified under ORS 657.176(2) from receiv-

ing unemployment benefits because she was discharged

from her position as a respiratory therapist for misconduct

for having violated employer’s policy in refusing to receive a

COVID-19 vaccination. Claimant raises four assignments of

error. Each of them is premised in part on claimant’s view

that EAB’s order violated claimant’s rights, either under the

First Amendment or because claimant’s action in refusing to

be vaccinated was based on a sincerely held religious belief

that employer had an obligation to accommodate under Title

VII of the Civil Rights Act of 1964, 42 USC sections 2000e

to 2000e-17. In reviewing EAB’s findings for substantial evi-

dence in the record and its legal conclusions for errors of law,

ORS 183.482(8); Marella v. Employment Dept., 223 Or App

121, 123, 194 P3d 849 (2008), we conclude that EAB’s order

must be reversed and remanded for reconsideration.

The facts are undisputed. Claimant worked for

employer as a respiratory therapist. Claimant worked

with many COVID-19 patients until she was discharged

from her employment in October 2021. She complied with

all of employer’s protocols for protective gear and personal

hygiene; however, she declined to be vaccinated, as required

by employer’s policy and an administrative rule adopted by

the Oregon Health Authority (OHA), OAR 333-019-1010(1)

(Sept 1, 2021).1

1

OAR 333-019-1010(1) (Sept 1, 2021) provides:

“It is vital to this state that healthcare providers and healthcare staff be

vaccinated against COVID-19. COVID-19 undergoes frequent mutations as

it replicates, which over time has resulted in variants that are more trans-

missible or cause more severe disease. As of the time this rule was adopted,

Delta was the variant making up more than 98 percent of sequenced speci-

mens in Oregon. The Delta variant is approximately two to three times more

infectious than early wild-type COVID-19 variants. There is emerging evi-

dence that people infected with the Delta variant have similar viral loads

regardless of vaccination status suggesting that even vaccine breakthrough

cases may transmit this variant effectively. Being vaccinated, is therefore

critical to prevent spread of Delta. Healthcare providers and healthcare staff

have contact with multiple patients over the course of a typical day and week,

Cite as 326 Or App 490 (2023) 493

OAR 333-019-1010 (2021) included a provision

allowing employers to grant exemptions to those workers

whose sincere religious convictions prevented them from

receiving a COVID-19 vaccine. OAR 333-019-1010(3), (4)

(2021).2 Claimant describes herself as a religious person.

including providers that provide care for people in their homes. Individuals

cared for in these settings are more likely than the general public to have con-

ditions that put them at risk for complications due to COVID-19. COVID-19

variants are running through the state’s unvaccinated population and caus-

ing an increase in breakthrough cases for those who are fully vaccinated.

This rule is necessary to help control COVID-19, protect patients, and to

protect the state’s healthcare workforce.”

2

OAR 333-019-1010(3) (2021) provided:

“After October 18, 2021:

“(a) A health care provider or healthcare staff person may not work,

learn, study, assist, observe, or volunteer in a healthcare setting unless they

are fully vaccinated or have provided documentation of a medical or religious

exception.

“(b) An employer of healthcare providers or healthcare staff, a contrac-

tor, or a responsible party may not employ, contract with, or accept the vol-

unteer services of healthcare providers or healthcare staff persons who are

working, learning, studying, assisting, observing or volunteering at a health-

care setting unless the healthcare providers or healthcare staff persons are

fully vaccinated against COVID-19 or have a documented medical or reli-

gious exception.”

OAR 333-019-1010(4) (2021) provided:

“On or before October 18, 2021, healthcare providers and healthcare staff

must provide their employer, contractor or responsible party with either:

“(a) Proof of vaccination showing they are fully vaccinated; or

“(b) Documentation of a medical or religious exception.

“(A) A medical exception must be corroborated by a document signed by

a medical provider, who is not the individual seeking the exception, on a form

prescribed by the Oregon Health Authority (OHA) or a similar form that con-

tains all of the information required in the OHA form, certifying that the

individual has a physical or mental impairment that limits the individual’s

ability to receive a COVID-19 vaccination based on a specified medical diag-

nosis, and that specifies whether the impairment is temporary in nature or

permanent.

“(B) A religious exception must be corroborated by a document, on a

form prescribed by the Oregon Health Authority (OHA) or a similar form

that contains all of the information required in the OHA form, signed by the

individual stating that the individual is requesting an exception from the

COVID-19 vaccination requirement on the basis of a sincerely held religious

belief and including a statement describing the way in which the vaccination

requirement conflicts with the religious observance, practice, or belief of the

individual.”

OAR 333-019-1010(5)(b) (2021) provided that nothing in the rule was intended

to prevent healthcare facilities from “[h]aving more restrictive or additional

requirements.”

494 Lavelle-Hayden v. Employment Dept.

When she obtained information that led her to believe that

the available vaccines had been developed with the use of

aborted fetuses, she concluded that her sincerely held reli-

gious beliefs would not allow her to be vaccinated, and she

sought a religious exemption.

Employer required claimant to complete a form

requesting an exemption from the vaccination require-

ment. Employer instructed employees requesting a reli-

gious exception to attach a signed letter from a religious

authority in the employee’s faith community “explaining

how administration of the COVID-19 vaccine conflicts with

bona-fide religious tenets or practices of your faith.”3 If the

employee did not have a religious authority, employer autho-

rized the employee to submit their own letter containing the

same information. Employer’s policy required the request

for exemption to be specific about the “bona-fide” religious

belief and advised employees that a “general philosophical

or moral objection to the vaccine will not be sufficient for

[employer] to evaluate the request or grant an exemption.”

Claimant’s church declined to provide documenta-

tion in support of claimant’s request for exemption, so claim-

ant submitted a letter describing her religious beliefs that

required her to decline to be vaccinated:

“According to my Christian faith, I believe my body is a

temple of the Holy Spirit and it is a personal responsibil-

ity for me to protect my body’s physical integrity against

unethical and harmful ingredients and injections.

“* * * I believe that life is precious and a gift and I per-

sonally do not believe in abortion. Stem cells from aborted

fetuses are used in testing of the vaccines or are in the

vaccines themselves. I cannot in good conscience take these

vaccines knowing that the creation or contents of the vac-

cines go against my personal and religious beliefs.”

3

We note that, although employer’s policy referred to a “bona-fide religious

tenet,” which appears to be the judicially established standard under Title VII,

Heller v. EBB Auto Co., 8 F3d 1433, 1438 (9th Cir 1993), OAR 333-019-1010(4)

(2021) refers to an exemption based on “a sincerely held religious belief.” The

parties do not address that distinction or propose that it makes any substantive

difference to our analysis and they use the terms interchangeably. In this opin-

ion, we use both terms, depending on context.

Cite as 326 Or App 490 (2023) 495

Employer had established a committee to review

religious exemption requests based on two criteria: (1) con-

sistency (i.e., whether the employee had recently received

other vaccines), and (2) specificity (i.e., whether the employee

clearly stated their religious belief, and that the religious

belief is specifically against receiving the COVID-19

vaccine).

Employer determined that claimant did not meet

its criteria for a religious exemption and rejected claimant’s

request for an exemption. Employer offered claimant the

choice of receiving the vaccination, being placed on admin-

istrative leave and then terminated from employment,

or resigning. Claimant chose to be terminated from her

employment.

When claimant filed a claim for unemployment ben-

efit, employer rejected the claim based on misconduct. The

Employment Department issued an administrative decision

upholding employer’s denial, explaining that, in failing to

comply with employer’s reasonable vaccination policy, claim-

ant had violated standards of behavior that an employer had

a right to expect and had thereby engaged in misconduct. At

a hearing, claimant described her reasons for declining to

be vaccinated:

“I am a Christian who believes in God and live by the

words in the Bible. So I believe the Bible says we are not

permitted to treat the body in a way we believe will harm

it. So according to my faith and beliefs, we are created

in God’s image. I believe my body is a temple and it’s my

personal responsibility to protect my integrity of my body

against toxins and harmful things.”

Claimant testified that she had taken vaccines when she

was a child, but had not been vaccinated more recently and

that, as she got older, she felt her “religious and personal

beliefs have grown, and I’m more aware of what I put into

my body.” Claimant explained that she had declined to get

flu shots each year for religious reasons and that employer

had allowed that. Claimant also described her view that,

compared to other vaccines that she had taken in the past,

she felt that the COVID-19 vaccine had been rushed, “was

more in the news a lot[,]” and that “it was being forced on

496 Lavelle-Hayden v. Employment Dept.

people.” Claimant added that “the use of fetal cells in the

development, research, and production, it’s just some of

those things that I don’t condone and don’t feel deep down

that are right.”

An administrative law judge (ALJ) found that

claimant’s explanation expressed more of a general philo-

sophical or moral objection than a specific explanation of

how her religious beliefs would be violated. The ALJ noted

that the fact that claimant’s church had declined to provide

a letter supported an inference “that the church did not con-

sider taking the vaccine to be a violation of any religious

practice or tenet of faith.” The ALJ concluded that “[o]n this

record, claimant has not shown that she was entitled to an

exemption from the vaccine requirement on the basis of a

bona-fide religious belief” and upheld employer’s determina-

tion that claimant had been discharged for misconduct.

EAB affirmed the ALJ’s order and upheld the

department’s denial. EAB acknowledged that claimant had

sought a religious exemption but reasoned that employer had

adopted a reasonable and objective neutral policy and proce-

dure for determining whether to grant a religious exemption

and, after it denied claimant’s request, employer reasonably

expected that claimant would comply with the vaccination

policy. Because claimant had willfully violated employer’s

reasonable policy, EAB reasoned, she was discharged for

misconduct and therefore was disqualified from receiving

benefits. EAB did not address claimant’s contention that the

ALJ had erred in determining that claimant did not hold a

bona-fide religious belief.

On judicial review, claimant contends that EAB

erred in upholding the department’s denial of benefits. Each

of claimant’s assignments depend on her contention that her

refusal to get vaccinated could not be a basis for disquali-

fication, because her refusal was based on a sincerely held

religious belief that prevented her from getting vaccinated.

In her first assignment of error, claimant contends

that EAB erred in determining that she was discharged for

misconduct. Claimant contends that she was not discharged

for misconduct; rather, it was employer who engaged in

Cite as 326 Or App 490 (2023) 497

misconduct, by violating Title VII of the Civil Rights Act of

1964, in failing to accommodate claimant’s sincerely held

religious belief. In her second assignment, claimant con-

tends that, in upholding employer’s denial of benefits, EAB

unconstitutionally lent its support to “one side” of a religious

controversy rather than maintaining neutrality, as consti-

tutionally required. In her third assignment, claimant con-

tends that EAB violated her constitutional rights by condi-

tioning her exemption based on a sincerely held religious

belief on a letter from her church. In her fourth assignment,

claimant contends that EAB violated her constitutional

rights in finding that she was fired for misconduct based on

her refusal to violate a sincerely held religious conviction.

First assignment of error

As noted, in her first assignment of error, claimant

contends that EAB erred in determining that she was dis-

charged for misconduct, because employer’s determination

to discharge her ran afoul of Title VII of the Civil Rights

Act of 1964. We reject claimant’s contention. ORS 657.176(2)

requires disqualification from unemployment benefits if the

employer discharges a claimant for “misconduct connected

with work.” “Misconduct connected with work” includes “a

willful or wantonly negligent violation of the standards of

behavior which an employer has the right to expect of an

employee.” OAR 471-030-0038(3)(a). It is undisputed that

claimant was discharged because she refused to comply

with employer’s vaccination requirement, which EAB deter-

mined was a reasonable policy. EAB determined that that

was misconduct.

Title VII provides:

“It shall be an unlawful employment practice for an

employer—

“(1) to fail or refuse to hire or to discharge any indi-

vidual, or otherwise to discriminate against any individ-

ual with respect to his compensation, terms, conditions, or

privileges of employment, because of such individual’s race,

color, religion, sex, or national origin.”

Claimant does not contend that this is a claim under Title

VII; she contends only that the analysis applicable to a

498 Lavelle-Hayden v. Employment Dept.

claim under Title VII should apply in determining whether

she was discharged for misconduct. As the Supreme Court

held in Heller v. Ebb Auto Co., 308 Or 1, 7, 774 P2d 1089

(1989), an administrative proceeding relating to the denial

of unemployment compensation benefits for misconduct is

not an employment discrimination claim under Title VII.

Rather, the analysis that bears on the the constitutional

implication of a denial of unemployment benefits based on

misconduct is whether the agency’s order runs afoul of the

First Amendment. See, e.g., Sherbert v. Verner, 374 US 398,

403, 83 S Ct 1790, 1793, 10 L Ed 2d 965 (1963) (holding

that the denial of unemployment benefits can violate the

Free Exercise Clause in cases where the claimants refused

or resigned from jobs that conflicted with their religious

beliefs). Because claimant’s contentions in her first assign-

ment of error challenging EAB’s determination that she was

discharged for misconduct are based entirely on Title VII,

we reject them.

Remaining assignments of error

Claimant’s remaining assignments challenge the

denial of unemployment compensation on constitutional

grounds, contending that her refusal to be vaccinated could

not be a basis for disqualification, because her refusal was

based on a sincerely held religious belief. As the department

acknowledges, under the Free Exercise Clause of the First

Amendment, a state generally cannot deny unemployment

benefits to a worker if the misconduct forming the basis for

the discharge from employment was the result of the worker

adhering to a sincerely held religious belief. Sherbert, 374

US at 403. The department correctly explains that, because

OAR 333-019-1010(4) (2021) specifically allows for a religious

exemption from vaccination, the state cannot condition the

receipt of unemployment benefits on a worker’s willingness

to be vaccinated if receiving the vaccine is, in fact, forbid-

den by the worker’s sincerely held religious beliefs.4 Thus,

4

We note that EAB relied on Employment Division v. Smith, 494 US 872, 881,

110 S Ct 1595, 108 L Ed 2d 876 (1990), as the “operative authority,” in support of

its conclusion that the state can deny unemployment benefits where the claimant

was discharged for violating a “valid and neutral law of general applicability,”

even if the claimant violated the law as a matter of sincere religious conviction.

However, as the department acknowledges, Smith is inapposite, because, in view

Cite as 326 Or App 490 (2023) 499

whether claimant was properly disqualified from unem-

ployment benefits in this case turns on the factual question

whether claimant’s refusal to comply with employer’s vac-

cine policy was the result of a sincerely held religious belief.

The board did not address that issue. Nor did it adopt the

ALJ’s finding that claimant did not have a “bona-fide” reli-

gious belief.

The department concedes that EAB’s failure to

make a factual determination regarding the sincerity of

claimant’s religious belief means that EAB’s order is not

supported by substantial reason, and that the order must

be remanded for EAB to determine whether claimant has

established that she was unable to comply with employer’s

vaccination policy because of a sincerely held religious belief.

We agree and accept the concession, and that concession

obviates the need to address the remaining assignments.

The department asserts that substantial evidence

in the record would support the ALJ’s finding that claimant

did not have a sincerely held religious belief that prevented

her from being vaccinated. That is an issue that the board

can consider in the first instance on remand.

Reversed and remanded.

of the religious exemption provided by OAR 333-019-1010(4) (2021), this case

does not involve the violation of a “neutral law of general applicability.” Thus,

the department concedes, it is not the rule from Smith but rather the test from

Sherbert that governs. Under that test, if a person was, in fact, unable to get the

COVID vaccine because of a sincerely held religious belief, and was terminated

as a result, Oregon could not deny unemployment benefits to that person absent

a “compelling government interest” in doing so.